SNP warn Chancellor not to treat North Sea as a ‘cash cow’

The Chancellor has been warned by the SNP not to raise taxes on the oil industry following a recovery in North Sea output.

Tax revenues have fallen dramatically in relation to the price of oil as a result of levies on producers being restructured when the value fell below $30 per barrel at the start of 2016.

Prices have now risen above $70 but revenue for the Treasury is less than a quarter of what it was in 2010, when the cost of oil was at a similar level. A Treasury spokesman said the UK government was reviewing taxation.

The SNP’s Westminster economy spokesperson has written to Philip Hammond demanding he does not use the North Sea oil industry as a “cash-cow” to pay for new spending commitments on the NHS.

Aberdeen North MP Kirsty Blackman said: “Despite the UK government’s abject failure to support production during its recent time of need, the oil industry in the North Sea has been on the road to recovery.

“Using Scotland once again as a cash-cow, just as it is strengthening, risks the sector’s ability to invest and extract the North Sea’s full potential upon which so many jobs and our wider economy depend.”